People trying to figure out Medicare can get tripped up by the labels of the different types of coverage. Here are three examples.
I am enrolled in Part A and Part B and want to get Part G.
I need to find a Plan D that will cover my medications.
I signed up for Part C but I still need to get a PPO.
I could go on but you get the gist. Medicare’s alphabet soup identifies different types of coverage while creating confusion. Fitting the letters into a structure can help clean up the landscape.
Medicare teaches that there are four parts of Medicare. However, in my view, there are really three essential parts.
- Part A, hospital insurance, covers inpatient hospital and skilled nursing facility stays and hospice.
- Part B, medical insurance, is for outpatient services and preventive care.
- Part D, prescription drug coverage, covers medications. Private insurance companies offer Part D drug plans.
When first signing up for Medicare, everyone is enrolled in Part A and Part B, known as Original Medicare. Then they have a choice.
- Stick with just Part A and Part B. This has one big downside – unlimited out-of-pocket costs.
- Add a Medicare supplement plan (Medigap policy) and Part D drug plan to Part A and Part B: This approach eliminates the unlimited costs and introduces Medigap plans. Pay the monthly premium, see doctors and providers who accept Medicare, and out-of-pocket costs are limited to the Part B deductible, $283 this year.
- Elect Medicare Advantage: This is also known as Part C. However, it is not a part but rather a package. Medicare calls this “all-in-one alternative to Original Medicare,” bundling hospital and medical services (Part A and Part B) and incorporating Part D. In other words, Part A plus Part B plus Part D equals Medicare Advantage.
That covers the parts of Medicare. Now here’s where letters and plans come into play.
- Lettered Medigap plans: Over 30 years ago, Medicare standardized Medigap policies and identified the different plans by letters. In 2026, there is Plan A, B, C, D, F, G, K, L, M and N – a total of 10 plans (not parts).
- Medicare Advantage plans are identified by initialisms, abbreviations made up of first letters: Part C plans can be a preferred provider organization plan (PPO), a health maintenance organization (HMO), special needs plan (SNP), medical savings account (MSA), and private fee-for-service (PFFS).
So, when trying to interpret the alphabet soup, remember these points.
- Parts refer to the core of Medicare – Part A, Part B, and Part D.
- Single letters identify Medigap policies that work with Part A and Part B.
- Three- or four-letter abbreviations identify Medicare Advantage or Part C plans.
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